2021-01-06 | Ran (Alan) Zhang: An Interaction Analysis of Targeting Across Multi-platforms in the Consumer Purchase Funnel
We advance an empirical strategy aiming at measuring synergistic effects of online platforms for targeted advertising along the consumer-purchase funnel. Gauging meaningful interaction effects between activities on different platforms and within different parts of the purchase funnel is very challenging. This is due to (a) the presence of the potential “activity biases” (Lewis et al., 2011) where the most active users end up being targeted more frequently on different platforms and (b) “rare outcomes” indicating that ultimate conversion rates are negligible. We tackle these issues by a combination of tools in the epidemiology and machine learning literature comprising (a) case-control design to match retrospectively users showing a similar level of activity and (b) post-regularized choice models, proved to be effective even in the presence of rare outcomes. Our empirical analysis finds that targeting across platforms has a positive synergistic effect on the ultimate conversion for consumers at the lower funnel, but there is no measurable effect for the upper funnel consumers. In addition, the main effect of targeting on social media is positively related to the ultimate conversions for users in the early stage but has no incremental impact when consumers move down to the lower funnel. These point to the presence of an intricate pattern of complementarities between social media and traditional content portals along the consumer purchase funnel.
Dr. Ran (Alan) Zhang is an assistant professor at Department of Information Systems, City University of Hong Kong. His research interests lie at the intersection of IS and Marketing. His current research primarily focuses on business data analytics, economics of digitization, digital markets and digital platforms, healthcare services, and pricing and bundling strategy. His works have been accepted in the MIS Quarterly and international conference proceedings including ICIS, HICSS, CIST, and AMCIS. He has obtained several reputational research grants from Hong Kong Research Grants Council and Marketing Science Institute. Dr. Zhang has taught courses including Business Data Analytics, Blockchain Design and Application, Database Design and Management, Business Intelligence, and IT management at both undergraduate and postgraduate levels. Prior to joining academics, Dr. Zhang has worked as a system analyst in the IT industry in China and in the United States.